Bummer

Nifty50: 17,014 ▼ 109 (-0.6%)
Sensex: 57,235 ▼ 390 (-0.6%)

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• Markets slipped back into the red after India’s inflation data dampened the investor sentiment.
• In all, 36 of the Nifty50 stocks closed in the negative. 
• The US inflation rate marginally eased to 8.2% in September, the lowest since February 2022.

Among the Nifty sectoral indices, Media (+0.2%) and Pharma (+0.2%) saw meagre gains, while PSU Bank (-1.5%) and Bank (-1.2%) were the top losers.

What’s trending

⭐ Infosys posts strong results

INFY (NSE): 1,422 ▼ 6.7 (-0.4%)

Infosys reported robust growth for the September quarter. Its revenue rose by 23.4% year-on-year (YoY) to ₹36,538 crore, while net profit grew 11% YoY to ₹6,026 crore. Meanwhile, the attrition rate dipped for the third consecutive quarter to 27.1%. The company also announced an interim dividend of ₹16.5 per share and a share buyback plan of ₹9,300 crore.

⭐ Govt gives one-time grant to OMCs

IOC (NSE): 66 ▼ 0.3 (-0.5%), BPCL (NSE): 300 ▼ 1.9 (-0.6%)

The Indian government has approved a one-time grant of ₹22,000 crore to three state-owned oil marketing companies (OMCs) IOC, BPCL and HPCL. The grant will help the OMCs to cover losses they have incurred on the retail distribution of petrol, diesel and LPG. In the last two years, LPG prices have risen by 300% in the international markets. But this was not fully passed on to consumers, leading to huge losses for OMCs.

⭐ Adani Wilmar expects muted growth in Q2

AWL (NSE): 682 ▼ 25 (-3.6%)

Shares of edible oil major Adani Wilmar declined by nearly 4% intraday following the announcement of its quarterly business update. The company expects its overall revenue to grow in low single digits during the September quarter. This is due to a slow uptick in rural demand, extended monsoons and rising interest rates. However, the consumption may see a rebound during the second half of FY23.

⭐ Veranda Learning acquires JK Shah Classes

VERANDA (NSE): 330 ▼ 13 (-3.9%)

EdTech company Veranda Learning has acquired Mumbai-based JK Shah Education through its wholly owned subsidiary Veranda XL Learning Solutions. The total consideration of ₹337 crore will be paid in two phases, with 76% of the total amount being paid in the first phase. Veranda will fund the acquisition through a combination of debt and equity.

In Focus

Double trouble for the economy

Two key macroeconomic indicators—retail inflation and the index of industrial production (IIP)—were announced on Wednesday. And things are not looking good. Retail inflation spiked to a five-month high of 7.4% in September, while the IIP contracted by 0.8% in August. 

Both the metrics portray a grim picture of the economy, which up till now had remained resilient despite several challenges. On the one hand, retail inflation accelerated for a second consecutive month owing to a record rise in food prices, as erratic rainfall impacted crop output.

At the same time, the IIP dropped to a 18-month low as manufacturing activity declined in 9 out of the 22 manufacturing subsectors. Among these, pharmaceuticals (-19%), textiles (-12.2%), electrical equipment (-28.2%) saw the biggest fall.

Both the data points are conflicting in nature and would present a challenge to the government and the RBI. RBI could be in a dilemma whether to hike interest rates to tame inflation or to focus on growth.

How will the policy makers tackle this? We’ll have to wait and watch.

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Good to know

What is the IIP?

The Index of Industrial Production (IIP) measures the changes in the volume of production in key industries like manufacturing, mining and utilities over a specific period of time. The index is an important macroeconomic indicator for investors and economists. A higher reading is considered as positive for the economy.

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